While protectionism is not an option for Europe, neither can the EU allow its internal market to be flooded by products that fly in the face of its social and environmental standards and jeopardise its industry, warned the European Economic and Social Committee (EESC) in a report adopted last week on a comprehensive industrial policy for the EU
Europe wants to lead by example, with a manufacturing industry that protects workers' rights, preserves the environment and invests in innovation. However, all of this has significant costs, which are reflected in the price of its products. To guarantee fair trading conditions for its industry, the EU must ensure that global products entering its market abide by the same rules. This was the key message of the EESC's opinion on A Comprehensive approach to industrial policy.
Europe cannot ignore existing practices by other global players that put at risk European values, competitiveness, jobs and welfare. It cannot afford to be naïve. Overcapacity, illegal state aid and other forms of unfair competition must be tackled by European regulation, while respecting WTO rules, said rapporteur Gonçalo Lobo Xavier, adviser to the Board of the Portuguese Association of Metallurgical, Mechanical Engineering and Similar Industries (AIMMAP).
The tools to fight these practices must be on the EU's agenda, with ways to closely monitor what is happening in the internal market and respond promptly when necessary. Antidumping measures adopted by the European Commission need to be swifter, better monitored and more flexible in order to achieve the goal without side effects.
A coherent long-term policy is needed
Compared to global players such as China, India and Korea, which have been very active in developing their industrial policy, Europe has no coherent long-term outlook for its industry, stressed the EESC, alluding to shortcomings in the European Commission's recent document on Investing in a smart, innovative and sustainable Industry – A renewed EU Industrial Policy Strategy.
While the analysis of where Europe stands and wants to go is good, it is not clear how to get there – what needs to be done in terms of practical policies, argued the rapporteur.
A consistent industrial action plan is needed, with binding targets, timetables, instruments and shared responsibility between the EU and Member States to tackle the four key challenges of the next ten years: digitalisation, climate change, globalisation and demographic change.
The power of "made in Europe"
The Commission's decision to organise a European Industry Day – held for the first time in 2017 and now scheduled for 22 February 2018 – was an important step in the right direction towards making Europeans aware of the power of "made in Europe" and the impact of European industry on society, said the EESC, emphasising how employers' and workers' organisations can be strategic partners in such efforts.
Reshoring European Industry
Reshoring at least some sectors of Europe's industry is also of paramount importance. The EESC believes that this process must be based on Europe's best assets – an economic model based on knowledge, innovation, high-level skills, R&D and a business environment that respects EU social standards.
"We support the idea of Europe being a world leader in digitalisation, a low-carbon economy and innovation", stressed Dirk Bergrath, director for European policy at German trade union IG Metall and co-rapporteur for the opinion. "We feel that Europe can only be competitive if we are better, because it is not really our destiny to be cheaper than others. We must be better. Therefore we need to link up our industrial policy with social standards. We can produce good quality industrial products in Europe only if workers have safe and properly remunerated jobs."
The opinion was drawn up at the request of the Bulgarian presidency of the EU, which specifically asked for the EESC's advice on a comprehensive approach to industrial policy in Europe. In parallel, the EESC's Consultative Commission on Industrial Change is also working on a detailed response to the Commission's communication on A renewed EU Industrial Policy Strategy, which is to be voted on at the EESC's plenary session on 14-15 February 2018.
The EESC will present its opinion on a comprehensive long-term industrial policy for Europe at an informal Council of industry ministers to be held in Sofia on 1 February, and hopes that its advice will weigh in on the Council's decisions.